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FTTx Deployments - Key Issues DigiWorld Summit
2006 4th International Broadband
Forum Montpellier, 14th November 2006


Roland MONTAGNE Head of Broadband
Practice r.montagne_at_idate.org
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FTTH Worldwide Status Strategies leaders

• Japan the FTTH leader
• More new FTTx subscribers than new DSL
  subscribers since April 2005
• Since June 2005, FTTH has overtaken cable in
  Japan
• 5.6 million FTTH/B subscribers in June 2006
• Governments proactive approach to FTTx
  deployment 30 M FTTH subs. in 2010
• USA FTTH is the unique solution for RBOCs
• Power of Cable operators Time Warner, Comcast,
  CableVision launching 30 and 50 Mbps access
  offers
• By 1Q2006 Verizon had passed around 4M homes
  for fibre and counted 264 000 FTTx subscribers
  (375 000 by 2Q2006). Expected for end 2006 6M
  Homes passed and 900 000 FTTx subscribers
• ATT (more FTTN oriented) and Verizon launched
  Fibre access for doing HDTV

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FTTH Worldwide Status Strategies Europe

• Mid of 2006, less than 800 000 FTTH/B subscribers
  in the EU 18 (23 vs June 2005)
• Mid of 2006, around 2.7 millions Homes passed in
  the EU 18 (10 vs June 2005)
• ? A global penetration rate of more than 28
• Mid of 2006, Deutsche Telekom covers 2.9 millions
  homes in 10 major cities in Germany with FTTN
  VDSL2

Source IDATE
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FTTH What will be the drivers?

• Residential market applications
• A few specific applications needing more
  Bandwidth HDTV, video services, blogs, personal
  content exchanges,
• A growth of the needs concerning Bandwidth but
  also Symmetry this will be driven by
  simultaneous usages in the home that have already
  started with Triple Play

Minimum bandwidth requirements
Source IDATE
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FTTH What will be the drivers? Copper
Competition

• Copper limits
• A demand today quite well satisfied by download
  rate proposed ADSL2 but
• Eligibility constraints. Beyond 1.5 to 2 km from
  the DSLAM download speeds drops dramatically
• These two major constraints inherent in ADSL
  technologies, i.e. asymmetry and bandwidth
  limitation, prevent operators from being able to
  supply the applications that digital homes will
  be demanding in the very near future
• Competition
• The competition coming from Cable Modem USA,
  Netherlands, Belgium,
• Japan example (NTT) FTTH subscriber churn rate
  is lower than for ADSL subscribers
• French example Competition between France
  Telecom (Orange), Free and neuf cegetel

Source IDATE
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FTTx - Technology choice Maturity

• Two distinct mature solutions possible today for
  expanding fibre optic coverage

Passive network
Source IDATE/Lucent
Source  IDATE/Lucent
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FTTx Technology choice? French case
Copper Local Loop structure in France
Source IDATE

• Subscribers (d) average distance from SC 700
  to 800 m 300 m in Germany 420 m in the UK 500
  m in Italy
• Subscribers (dd) average distance from the
  local exchange
• 29 of lines at less than 1 Km (nearly 100 in
  Italy!!)
• 39 of lines at less than 1.5 Km
• 52 of lines at less than 2 Km

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FTTH Cost is still the major issue? French case

• Base option Greenfield deployments main cities
  then residential areas
• Technologies GPON and Ethernet P2P
• Deployment 2006 to 2015 for a coverage of 40
  of the population
• In 2015 11.9 million homes passed and 5.3
  subscribers
• Results total investments between 10.4 and 11.3
  billions euros over 10 years
• Civil Engineering represents 70 of the costs
• EBIT positive in 2012
• Entering in residential areas in 2010 with
  individual homes has a strong impact in
  deployment costs

Investments per year (in million EUR)
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FTTH Cost is still the major issue? French case

• Option 1 Paris with usage of passive existing
  infrastructure (Paris sewer)
• At 1/m/year it allows an economy of 30 compared
  to the Greenfield case
• In 2015 1.1 million homes passed and 0.5
  million subscribers
• Option 2 France with usage of ducts already
  existing
• At 2/m/year it allows an economy of 50 compared
  to the Greenfield case
• In 2015 9.1 million homes passed and 2.6
  million subscribers
• Mutualisation is the key access at existing
  passive infrastructures

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Key questions

• Japan, US lessons to be learned from the FTTH
  leaders?
• Verizon, NTT, FTTH Council USA, Corning
• What is the situation in Europe? What are the
  barriers?
• FTTH Council Europe, Deutsche Telekom, Close the
  Gap
• Maturity of FTTx technologies?
• Alcatel, Sagem
• When deploying FTTH in Greenfield, Civil
  Engineering is representing most of the costs
  Progress to come in these fields?
• Vinci Networks, Sogetrel
• French Case after the announcements and trials,
  is there a true market for Fibre in the country?
• The players France Telecom, CiteFibre/Free,
  Erenis, neuf cegetel, Numericable
• Role of Local Bodies CDC, Ville de Paris
• What will be the evolution of Regulation with
  the arrival of FTTH?
• Arceps point of view